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Diffusion of New Drugs in the Post-TRIPS Era

Author

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  • Ernst Berndt
  • Nathan Blalock
  • Iain Cockburn

Abstract

We examine the international diffusion of new drugs under the post-TRIPS intellectual property rights regime. Even after controlling for drug characteristics and variation in national health expenditure, we find substantial differences across countries in the probability of a drug being commercially available, lowest in countries such as Brazil, China and India with historically weak patent protection. Notwithstanding obligations now in force under the TRIPS Agreement to provide patent protection for pharmaceutical products, sellers of new drugs are much less likely to have market exclusivity in these countries. Conditional upon being launched, a drug is five to 25 times more likely to be generic/multisource in these countries than in, for example, Spain.

Suggested Citation

  • Ernst Berndt & Nathan Blalock & Iain Cockburn, 2011. "Diffusion of New Drugs in the Post-TRIPS Era," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 18(2), pages 203-224.
    • Handle: RePEc:taf:ijecbs:v:18:y:2011:i:2:p:203-224
    DOI: 10.1080/13571516.2011.584426
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    References listed on IDEAS

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    1. Ernst Berndt & Murray Aitken, 2011. "Brand Loyalty, Generic Entry and Price Competition in Pharmaceuticals in the Quarter Century after the 1984 Waxman-Hatch Legislation," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 18(2), pages 177-201.
    2. Jean O. Lanjouw, 2005. "Patents, Price Controls and Access to New Drugs: How Policy Affects Global Market Entry," Working Papers 61, Center for Global Development.
    3. Margaret K. Kyle & Anita M. McGahan, 2012. "Investments in Pharmaceuticals Before and After TRIPS," The Review of Economics and Statistics, MIT Press, vol. 94(4), pages 1157-1172, November.
    4. Patricia M. Danzon & Andrew J. Epstein, 2012. "Effects of Regulation on Drug Launch and Pricing in Interdependent Markets," Advances in Health Economics and Health Services Research, in: The Economics of Medical Technology, pages 35-71, Emerald Group Publishing Limited.
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    Cited by:

    1. Chatterjee, Chirantan & Kubo, Kensuke & Pingali, Viswanath, 2015. "The consumer welfare implications of governmental policies and firm strategy in markets for medicines," Journal of Health Economics, Elsevier, vol. 44(C), pages 255-273.
    2. Margaret Kyle & Yi Qian, 2014. "Intellectual Property Rights and Access to Innovation: Evidence from TRIPS," NBER Working Papers 20799, National Bureau of Economic Research, Inc.

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